UK Economics

Calculate it how you want, the EU budget is too big, says ROSS CLARK

AS SOON as he wrote down the expression “£350million a week” for his newspaper article last week Foreign Secretary Boris Johnson will have known full well that he was opening an exploding can of worms.

Boris JohnsonGETTY

Boris Johnson giving a speech which informed voters that ‘we send the EU £350million a week’

But even he was taken aback by the curt open letter written to him by Sir David Norgrove, head of the UK Statistics Authority, claiming he had committed a “clear misuse of official statistics”.As a civil servant, Sir David doesn’t have an official position on , of course, but his sympathies can be guessed at by his eagerness to rush into condemning this particular use of statistics when he seems to be less inclined to comment, for example, on Labour’s claim that inequality is rising or Nick Clegg’s claim that three million British jobs are “dependent” on the EU.

The £350million-a-week figure, which appeared on the side of the Vote Leave campaign bus during last year’s referendum campaign as Britain’s contribution to the EU budget, has become central to the Remainers’ claim that the country was misled into voting Leave.

There are several ways – gross and net – to measure the UK’s contribution to the EU budget, but whichever you use it is impossible to escape three conclusions: first that we pay in far more to the EU budget than we get out of it; second, that the gap has widened; and third that it would only have got bigger in years to come had we voted to stay in the EU.

That ought to be that.Trying to claim that the country was somehow duped into voting leave because of something written on the side of a bus is foolish.

As for the complaint that the NHS has yet to see the £350million a week which the Vote Leave bus appeared to promise, it is nonsense.

We haven’t left the  yet, so we are still paying our contribution.

Moreover, the Vote Leave campaign was not a party standing for government.

EU and British flagGETTY

We haven’t left the EU yet, so we are still paying our contribution

The suggestion that we should spend our savings on the NHS was just a suggestion for a future government to consider.To get the statistics straight: £350million a week is Britain’s gross contribution to the EU, excluding the rebate won by Mrs Thatcher in the 1980s and which the EU has repeatedly tried to abolish.

When you take the rebate into account Britain’s net contribution came down to £12.2billion in 2016/17 – or £235million a week.

Some of this money is spent on public projects in Britain.

If you subtract the value of those payments our net contribution comes out at £8.1billion a year – equivalent to £156million a week.Or you can subtract the total amount of EU money that comes back to Britain in any form – including, for example, payments to farmers under the Common Agricultural Policy.

According to the EU, this was £6.7billion.

If you use that figure you can work Britain’s net contribution down to a “mere” £5.5billion a year – £106million a week.

It is legitimate to quote any of these figures, as long as you are clear what they represent – as the Foreign Secretary did at the weekend, describing £350million a week as the gross figure over which we will “take back control” once we have left the EU – and that it would be a “fine thing” if “a lot” of that money went into the NHS.


£350million a week is Britain’s gross contribution to the EU

There is no reason why a future British government, after leaving the EU, should want to continue paying subsidies to wealthy landowners.Nor might it be inclined to replicate EU projects such as a new pier in the wealthy Suffolk resort of Southwold and so on.

Therefore, it is not wrong to say that the amount of extra money a future British government will be able to spend on the NHS will be a lot more than our current net contribution.

The Foreign Secretary’s critics fail to take into account that the EU budget, and our contributions to it, are growing.

By 2020 the EU budget in today’s money is scheduled to keep growing from €145billion (£132billion) to €162billion (£147million).We would also be likely, had we voted to stay in, to receive back an ever smaller slice of the EU cake.

In 2003 just under 7 per cent of the EU budget was spent in Britain, by last year that had shrunk to a shade over five per cent.

The EU is a voracious, democratically unaccountable fiscal monster whose budget will carry on growing as long as it is allowed to.


In 2003 just under 7 per cent of the EU budget was spent in Britain

Preposterously it claims to be good value for money on the grounds that it spends only one per cent of European GDP – far less than any European government.It is a ludicrous comparison because unlike governments the EU does not pay for public healthcare or pensions (except for its own fatcat staff).

What it does spend money on, on the other hand, is its 42,000-bottle wine cellar and on such fripperies as the £27,000 chartered plane to take Jean-Claude Juncker to a summit in Rome in 2016.

The sooner we are no longer contributing to the EU’s excess, the better.

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Boris only claimed that we will control how we spend the money after Brexit, perhaps taking account of the fact that the Rebate could be vulnerable to future changes, as has been demanded many times by our Continental friends, or by a future UK leader. Tony Blair called the Rebate an anomaly when he gave a slice of it back and Junker’s State of the EU speech made clear that a finance minister plus the euro currency is still the target; that sounds like €400 million for starters, with absolutely no control thereafter. So it is actually possible to justify… Read more »

Jane Davies
Jane Davies

Any monies ‘given’ back to the UK had to be spent on projects dictated by the EU. Certainly not spent to make the lives of the homeless, sick and disabled any better.

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